Employees at Kairos Commodities A/S
The Company’s history and development
Kairos Commodities was launched as a strategic business unit by Danish Purchasing and Logistics Forum (DILF) in December of 2007, following a bit more than one year of development and preparation.
The Danish Purchasing and Logistics Forum is Denmark’s largest association of procurement, SCM and logistics professional, who together form a network of more than 4000 members. DILF was founded in 1962, and aims to be a non-political, not-for-profit based national association. DILF’s mission is to increase interest in procurement, logistics and related areas, and to improve the standard of these areas within the private and public sector. DILF aims toward being the preferred and obvious choice of supplier within its professional area.
DILF had in 2007 identified a demand amongst its members, for structured commodity marked information, analysis and forecasts of commodity prices aimed towards procurement professionals. Several companies had expressed a concern that the extreme volatility of commodity markets in recent years created greater challenges than ever before for purchasers and commodity managers in successfully managing cost and risk. Raw material purchasers have been facing one of the most volatile markets in history, while purchasers of semi- or fully manufactured articles have been experiencing sellers who forwarded price increases to the buyer almost instantly, but maintained high prices when the market was dropping. At the time volatility had never been greater with commodities doubling, trebling and then halving in more compressed time frames than their usual, historical pattern.
DILF assessed, that is was imperative that the volatility for each commodity and its detailed sub-segments were managed much more proactively than before, not only to avoid price increases, but also to ensure relative stability and predictability of company earnings. The volatile commodity markets meant a vital need for purchasers and commodity managers to be thoroughly equipped for dealing with these challenging conditions.
Accordingly, DILF conducted in 2008 a study of more than 200 of Denmark’s largest companies’ annual reports, which concluded that more than 95% of the companies were reporting problems with raw material price volatility.
Several international surveys from Booz & Co., PA Consulting, ATKearney, Aberdeen, and others, identified Risk Management among top 3 of the most important tasks for the procurement function, not only today, but also in the years to come.
This lead DILF to believe that Commodity Risk Management would be “The next big thing” in Purchasing, following decade’s of focus on Sourcing and Category Management.
With Kairos Commodities, DILF wanted to convince its members that it was time to stop predicting commodity prices based on newspaper articles, industry insights, educated guesswork or gut instincts.
DILF believes that the right way to handle risks when buying commodities is to attain superior information about the markets. As such, online access to well-structured and comprehensive data covering all of a company’s major commodities and categories of expenditure is essential for the whole procurement team. In principal, the value of access to market intelligence and valid forecasts, etc., is equally large in the sales division or for the company’s top management.
At the time of its launch Kairos Commodities was solely a web-based portal that gathered market information, tracked and forecasted price developments in the areas of metals, energy, plastics and currencies through business cycle analysis, fundamental analysis and technical analysis.
Since then, Kairos Commodities has expanded the scope of the web-based portal to include more ways of analyzing, to do customized reports, to include new commodities in the areas of soft commodities and others. We have also acted on the marked demand for doing consulting business and training of the users of the web-based portal.
During the first year Kairos Commodities focused solely on targeting Danish companies, but as resources became available the target market was expanded to include the whole of Europe. This change in strategy quickly proved to be successful, as several large international companies became customers of Kairos Commodities. Because of the international potential DILF in 2009 believed that it was necessary to establish Kairos Commodities as an individual company. As of September 2009 Kairos Commodities A/S was established as an independent company.
Board of Directors
Advisory Board
- Danfoss A/S
- Finanshuset Demetra A/S
- FLSmidth A/S
- Missionpharma
- Nordzucker AG
- Novo Nordisk A/S
- PricewaterhouseCoopers
Click here for further information about Advisory Board
Click here for a brochure that describes what Kairos Commodities delivers.